6.  The present application has its background in a civil dispute over securities dealings between Procedo Capital Corporation (hereinafter referred to as “Procedo”) and a Norwegian securities broker, Sundal Collier, based in Norway. In October 1998 the latter brought proceedings against the former before the Oslo City Court (tingrett), requesting an order that the applicant company pay an amount of 18,481,808 Norwegian kroner (NOK) plus interest in respect of shares Sundal Collier had purchased for the applicant company. The applicant company, which received the summons in December 1999, contested the action and brought a counter-action requesting an order that Sundal Collier pay compensation, the amount of which was to be determined in subsequent proceedings, with regard to losses sustained by the applicant company due to information and advice received from Sundal Collier.
7.  By a judgment of 4 January 2002, the City Court ordered the applicant company to pay Sundal Collier NOK 18,131,808 plus interest and dismissed any claim against the latter. Each party was to bear its own costs.
8.  The applicant company then lodged an appeal with the Borgarting High Court (lagmannsrett).
9.  In its appeal to the High Court the applicant company requested that, as had been done before the City Court, adjudication in the counter-action, notably concerning the amount of the applicant company’s counter-claim and related causation issues, be disjoined in accordance with Article 151 § 2 of the Code of Civil Procedure. Pursuant to that provision, separate proceedings were contingent on the other party’s agreement. After a preparatory meeting and exchanges of written pleadings on the issue, Mr Justice Minsaas, acting as the rapporteur judge of the High Court, decided on 18 December 2002 not to disjoin either the proceedings or the adjudication, finding insufficient basis for an agreement between the parties to this effect.
10.  At the preparatory stage the High Court decided, in view of the financial character of the subject matter, to sit with two lay members with expertise in financial matters and invited the parties to propose candidates. The applicant company did not make any proposal. Sundal Collier proposed Mr Abrahamsen (hereinafter referred to as “Mr A.” or “lay member A.”), an economist, and the applicant company did not object within the set time-limit.
11.  On 14 March 2003 the High Court appointed Mr A. as lay member, after having specified the impartiality requirement, and informed the parties about the prospective appointment of a second lay member, Mr D., an economist. However, since it turned out that Mr D. did not satisfy the impartiality requirement, he was replaced by Mr Bonnevie (hereinafter referred to as “Mr B.” or “lay member B.”), a chartered accountant.
12.  In the meantime the applicant company appealed against the High Court’s decision of 14 March 2003 to the Appeals Leave Committee of the Supreme Court disputing the necessity and desirability of appointing lay members in general. It also contested the procedure whereby Mr A. had been appointed on the proposal of Sundal Collier and not on a joint proposal by the parties. The applicant company questioned whether Mr A.’s professional background made him suitable as an expert in the case. On 15 May 2003 the Committee upheld the High Court’s decision, finding that the appeal had no prospects of success.
13.  The High Court held an oral hearing over nineteen days or so between 14 October and 13 November 2003 at which each party was represented by counsel and an assistant lawyer. From the outset it was composed of three professional judges – Mr Justice Omsted, President, Mr Justice Bøhn and Mr Justice Nesheim, ad hoc judge – and two expert lay judges, Mr A. and Mr B.
14.  There were no objections to the composition of the High Court at the opening of the hearing on 14 October 2003 (section 115 of the Administration of Courts Act (domstolloven) - Law of 13 August 1915 no. 5, see paragraph 36 below). On that date and on 15, 16 and 20 October 2003 the lawyers for the applicant company made their opening address.
15.  On the last-mentioned date the Presiding Judge of the High Court drew the parties’ attention to the fact that it was considering whether (as requested by the applicant company – see paragraph 9 above) it would be appropriate to disjoin the proceedings, as provided for in Article 98 § 2 of the 1915 Code of Civil Procedure (Tvistemålsloven), in respect of point 1 of the counter-action and invited the parties to give further consideration to the matter.
16.  In the morning of 21 October 2003 counsel for the applicant company continued his address and entered his plea. Thereafter the assistant lawyer for the respondent began his opening address. At some point during this address lay member Mr A. informed the parties that, in his capacity as an employee of PricewaterhouseCoopers, he had been involved in an assignment for ABG Sundal Collier and First Securities in connection with the listing of a company on the stock exchange. The parties gave notice that they wished to consider this matter in further detail and to revert later to the question whether Mr A. should be able to sit in the case.
17.  Before adjourning the proceedings on 21 October 2003, the Presiding Judge provided the parties with further information on the question of disjoining the proceedings with regard to the first point of the counter-action. The parties were asked to give their final comments on this question before counsel for the respondent commenced his opening address in respect of the counter-action.
18.  When the proceedings resumed on the following day, 22 October 2003, the Presiding Judge opened by taking up the question of the eligibility of Mr A. in response to the pleadings on this subject submitted by the applicant company’s lawyer. Mr A. then provided further details of his relationship with ABG Sundal Collier. Since some of the questions raised by the applicant company required further investigation by ABG Sundal Collier, it was agreed that the issue of the lay member’s ability to take part in the case should be adjourned until the following day.
The assistant lawyer for the respondent then continued his opening address and entered his pleas.
The Presiding Judge informed the parties that the Court intended to rule on the various procedural questions raised in the case the next day.
19.  When the proceedings resumed in the morning of the following day, 23 October 2003, counsel for the applicant company asked that Mr A. be absent from the pleadings regarding his eligibility. The High Court adjourned briefly to consider the question and, when the proceedings resumed, decided that Mr A. should not take part in the subsequent exchanges on the question.
20.  Counsel for each of the parties then made submissions on the question of eligibility with reference to section 108 of the Administration of Courts Act.
21.  The parties were then given the opportunity to argue their views on the question of disjoining the proceedings as provided for in Article 98 § 2 of the Code of Civil Procedure.
22.  At 12.30 p.m. the High Court adjourned the proceedings until the afternoon and withdrew to deliberate and vote in camera on the questions of eligibility and disjoinder.
23.  At 3 p.m. on the same day (23 October 2003) the High Court convened again, sitting with the professional judges and lay member Mr B. The High Court delivered two decisions, signed by the three professional judges and lay member Mr B., but not by lay member Mr A., who had not taken part.
24.  The first decision concerned the disqualification matter, in which the High Court observed inter alia:
“During the appeal proceedings lay member [Mr A.], who is an economist, remembered a circumstance that he thought appropriate to mention to the other members of the bench and which was then passed on to the parties.
[Mr A.] is a partner in PricewaterhouseCoopers DA. At the time of writing this company is engaged in an assignment for ABG Sundal Collier Norge ASA (referred to hereafter as ABG Sundal Collier), the parent company of one of the parties in this case, Sundal Collier & Co ASA. In collaboration with a second company, First Securities ASA, ABG Sundal Collier has undertaken a consultancy assignment for a company seeking to be listed on the Oslo Stock Exchange. PricewaterhouseCoopers’ assignment consists of providing certain auditing and accounting services in connection with the stock-exchange launch. The assignment was given last spring following a tendering competition and, according to the information provided, most of the work on the assignment is being performed by PricewaterhouseCoopers’ Bergen office. [Mr A] has been entrusted with the task of providing advice in connection with the assignment and will thus be one of the people who will provide the services in question. In this context he has also had some direct contact with a representative of ABG Sundal Collier. According to the submitted documents, the fee for the assignment will be approximately NOK 300,000. The assignment has not yet been completed. The company seeking listing will ultimately be liable for payment to PricewaterhouseCoopers.
After [Mr A.] had explained the situation, the [applicant company] requested further information from the opposing party and the parties subsequently exchanged pleadings on the question of eligibility. At today’s hearing Advocate Gade, acting for [the applicant company], filed an objection to the eligibility of lay member [Mr A.]. The parties were given the opportunity to comment on the question. [Mr A.] was not present in court during the submissions and decision on the question of his eligibility.
[The applicant company] argues that lay member [Mr A.] is disqualified pursuant to section 108 of the Administration of Courts Act. The company refers, among other things, to the information that PricewaterhouseCoopers has obtained approximately six per cent of the commissions carried out for ABG Sundal Collier during the last three years. A commission concerning a stock market introduction is very prestigious and is currently a rare occurrence. It is obvious that PricewaterhouseCoopers has considerable interest in obtaining this type and other kinds of assignments from ABG Sundal Collier, a main actor in this market. As a partner in PricewaterhouseCoopers, [Mr A.] has a direct financial interest in the company’s income and future income potential. What is decisive is how this matter would appear to the public. The counter-action in the case concerns a considerable compensation claim against Sundal Collier & Co ASA. According to the information available, there is currently no activity in this company, and it is obvious that, for the purposes of the impartiality issue, this company ought to be identified with ABG Sundal Collier, which has continued the daughter company’s activity. There is clearly too close a connection between [Mr A.] and the respondent for [Mr A.] to serve as a judge in the case. A further disqualifying circumstance is that [Mr E.] of ABG Sundal Collier is a central witness in the case with regard to the question whether [the applicant company’s] representative during a meeting with Sundal Collier & Co ASA, attended by [Mr E.], made statements which could provide a basis for demanding confiscation of assets. It is untenable for [Mr A.] to assess whether the witness statement from a person with whom he has a relationship of continuous professional cooperation is valid.
At the preparatory stage [the applicant company] was particularly concerned about the need for any lay members appointed to have sufficient independence from the parties and in this connection the company pointed to the close business relations between the large companies in the financial sector. It should also be emphasised that the law firm of counsel for the respondent carried out commissions for ABG Sundal Collier in connection with the stock market introduction. ...
Sundal Collier & Co ASA claim that lay member [Mr A.] is not disqualified from taking part in the case. His connection to the respondent in the appeal is too loose. This is illustrated by the fact that it never occurred to [Mr A.] in the beginning that there could be a ground for disqualifying him. The assignment in question is very small and [Mr A.] does not play a central role in it. His role is primarily to provide advice to PricewaterhouseCoopers’ office in Bergen, which is handling the consultancy. Bills and fees are addressed to ABG Sundal Collier and First Securities, but it is the company which is to be introduced on the stock market which will cover the costs. [Mr A.] does not have any daily or permanent dealing with the consultancy. This is a one-off consultancy consisting in objective accountancy considerations. [Mr A.] is not personally a contractual party and PricewaterhouseCoopers has no direct or indirect interest in the outcome of the court case. [Mr A.] will be removed from the consultancy. No one from counsel’s law firm who is directly involved in the case has been aware of the matter. The law firm has no commission for ABG Sundal Collier in connection with the stock market introduction but only for the company whose introduction is being sought.
The Norwegian financial milieu is small and there are very few large accountancy firms that are able to take on such consultancies. A strict interpretation of section 108 of the Administration of Courts Act would lead to a very narrow choice of competent lay members in cases where particular competence in finance and accountancy is required. ...
The High Court is of the view that there is nothing to suggest that lay member [Mr A.] is not fully able to reach an impartial decision in the case, notwithstanding the contractual relationship between ABG Sundal Collier and PricewaterhouseCoopers. It is noted that [Mr A.] himself did not view this relationship as a problem, and it was not until the second week of the proceedings that it occurred to him that he should mention the relationship. This is not decisive, however, since the question of disqualification must be considered on the basis of a more general assessment of what relationship between a lay member and a party will be deemed unacceptable pursuant to section 108 of the Administration of Courts Act.
The High Court notes that objections to the eligibility of the lay member have been entered by [the applicant company] and the court refers to [the applicant company]’s submissions as cited above. Having considered the matter in its entirety, the Court is of the view that, in the light of the circumstances, lay member [Mr A.] should withdraw.
The decision is unanimous.
Conclusion
[Mr A.] is ordered to withdraw.”
25.  In the second decision the High Court decided to disjoin the proceedings:
“Having put the question to the parties of disjoining the proceedings as provided for in Article 98 § 2 of the Code of Civil Procedure, the Court unanimously decided with respect to the counter-action – item 2 of the [applicant company’s] statement of claim – that the following two questions should be considered first: 1.Whether, in the light of the negotiating situation between the parties, Sundal Collier & Co ASA were in breach of their obligations in relation to [the applicant company], in other words whether there was an obligation for SCC not to apply for attachment in Norway, Sweden and/or Luxembourg. 2.Whether there exist other fault-based or strict grounds for liability in connection with the applications for attachment in Norway, Sweden and Luxembourg.
The decision means that for the time being the court will not review questions relating to a causal link in respect of the alleged losses or the question whether there should be imputation of liability between the [the applicant company] and the company Plentius.
After the proceedings had been completed in accordance with this decision, the High Court ruled, following deliberations, that a decision should be rendered in both the primary and the counter-action on the basis of the decision adopted.
26.  When the proceedings resumed on Monday 27 October 2003, counsel for the applicant company filed a motion for the case to be discontinued on the grounds of the High Court’s order of 23 October 2003 requiring lay member Mr A. to withdraw. Counsel for the respondent objected. Thereafter the Presiding Judge informed the parties that the High Court had unanimously decided that the proceedings should continue, as provided for in section 15(1) of the Administration of Courts Act (see paragraph 37 below). In this regard the High Court stated the following in its judgment of 22 January 2004:
 “The disqualification of the lay member [Mr A.] did not disqualify the other judges and the need for expert evidence was safeguarded in the further proceedings.”
27.  According to the transcripts of the High Court’s hearings, it subsequently heard the case from 28 to 30 October, 3 to 7 November and 10 to 13 November 2003.
28.  In a decision of 17 November 2003 the High Court reiterated its decision of 23 October 2003 on the disjoinder of the proceedings and affirmed that the appeal proceedings had been conducted in accordance with this decision until 13 November 2003. It further stated that, after its deliberations held on 14 and 17 November 2003, it had decided to close the proceedings and adjudicate the case – both the principal action and the counter-action as it had been pleaded.
29.  By a judgment of 22 January 2004, the High Court upheld the City Court’s judgment in the main and ordered the applicant company to pay specified amounts for Sundal Collier’s legal costs both before the City Court and the High Court.
30.  According to the High Court’s judgment, at an unspecified time after the City Court’s judgment of 4 January 2002, Sundal Collier & Co ASA’s broker activity had been taken over by the parent company ABG Sundal Collier and since then the former company had had no economic activity.
31.  The applicant company sought to appeal against the High Court’s procedure and judgment to the Supreme Court (Høyesterett).
32.  As to the procedure, the applicant company argued that the High Court judgment ought to be quashed, notably on the ground that the court had been unlawfully constituted. This was due to the participation of lay member A., who had been disqualified under section 108 of the Administration of Courts Act (Article 384 § 2, item 2, of the 1915 Code of Civil Procedure). In the alternative, the applicant company maintained that lay member A.’s participation must have had an influence on the High Court judgment (Article 384 § 1). The proceedings had lasted for “seven” days by the time lay member A. was ordered to withdraw. The substantive questions concerned relatively old facts, which meant that the parties’ pleadings and the case documents would be central to the High Court’s determination of the case. Moreover, the respective decisions to disqualify lay member A. and disjoin the proceedings had been taken in the same court session. A decision to disjoin the proceedings presupposed that the judges had discussed the substance of the case, an issue that had been raised on the fourth day of the hearing already. In the further alternative, the applicant submitted that the High Court’s decision to continue the proceedings with reference to section 15 of the Administration of Courts Act after A.’s withdrawal had constituted an error of procedure.
33.  The Court notes that in its notice of appeal of 8 April 2003 to the Appeals Leave Committee of the Supreme Court, the applicant company reiterated, inter alia, that it “had consistently argued in favour of disjoining the proceedings before the High Court, as had been done before the City Court, in accordance with Article 151 § 2 of the Code of Civil Procedure”.
34.  On 16 July 2004 the Appeals Leave Committee of the Supreme Court (Høyesteretts kjæremålsutvalg) refused the applicant company leave to appeal with regard to the High Court’s procedure, finding it obvious that the appeal had no prospects of success. As for the remainder, the Committee refused the applicant company leave on the ground that the appeal represented no interest beyond the particular case and that no other reason warranted the appeal being heard by the Supreme Court.